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Pull tab machine company's lawsuit against North Dakota dismissed

Pull tab machine company's lawsuit against North Dakota dismissed

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A California-based manufacturer of electronic pull tab machines and two North Dakota officials have agreed to the dismissal of a lawsuit in which the company sought money for damages suffered when its gambling license was suspended, court documents show.

Powerhouse Gaming Inc. and defendants North Dakota Attorney General Wayne Stenehjem and state Gaming Division Director Deborah McDaniel entered into a stipulation of dismissal on Wednesday. It wasn't immediately clear if the two sides had come to an out-of-court agreement.

Stenehjem on July 8 ordered that nearly 500 machines built by Powerhouse be shut down because the company failed to show it had purchased a software license for each device. Stenehjem in a statement said Powerhouse was using illegal or pirated software, terms the company said were slanderous.

Powerhouse sued, saying the company was unfairly targeted. It sought money damages and a restraining order that would allow it to continue operating. The suspension order cost Powerhouse $60,000 per week and threatened the jobs of 69 employees in five states, the company said. The license suspension was to stay in effect until the company proved its compliance, but the company said it “had a final effect” because its machines had been replaced by those of competitors.

U.S. District Judge Daniel Traynor on Thursday signed an order adopting the dismissal. The terms of the dismissal are not outlined in the documents, and the status of Powerhouse's ability to operate in North Dakota wasn't clear.

Powerhouse attorney Paul Sanderson told the Tribune that the company won't comment on the dismissal. Stenehjem was not immediately available for comment.

Reach Travis Svihovec at 701-250-8260 or Travis.Svihovec@bismarcktribune.com

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